Storing big toys for profit

Rising sales of boats, recreational vehicles boost storage facilities' revenue

A few months after moving to Cary, Dane Allen was welcomed by an unexpected visitor: the police.

They came about the boat.

The MasterCraft ProStar 190, Allen's baby, was on a trailer parked on the cul-de-sac outside the ranch house he rents. He was warned for breaking a town ordinance that governs trailer storage.

Neighbors had ratted him out.

"It seems like they would say something to me first," said Allen, 25.

An increase in sales of boats and other recreational vehicles is rubbing against increasing restrictions on where cities, towns and homeowners associations will let people store them.

But the headache for many boat and RV owners from Cary to California has become big business for an emerging corner of the commercial real estate world: self-storage.

In Durham, Orange and Wake counties, an average of 372 RVs and new boats have been registered each month this year -- up 18 percent from the average over the previous four years, according to data from the state Department of Transportation and N.C. Wildlife Resources Commission.

As a result, vehicle storage is being snapped up, rents are rising, and developers are building more space.

"People need a place to put their toys," said Dan Caster, owner of A-1 Personal Storage.

Soon after buying a North Raleigh storage facility last year, he bumped the monthly cost of vehicle storage by 60 percent to $80 -- and kept 90 percent of the spaces occupied.

StorageMax levied similar bumps in rents after acquiring a facility on Gresham Lake Road in Raleigh last year. Parking-space prices at its Rolesville facility jumped almost 60 percent to $55 per month. By comparison, Triangle office rents have increased 6 percent in the past two years.

Vehicle storage has long been an inexpensive way to generate income from land reserved for more lucrative mini warehouses, the kind people rent when their attics, basements or garages have overflowed.

At Caster's Wake Forest facility, several dozen RVs, boats and trailers snuggle on a half-acre, rock-covered lot. The spaces bring in about $3,200 a month in rent. It's a placeholder for the 300 mini-warehouse units he hopes to build. Those could bring in about $30,000 a month once occupied.

But operators are finding value in making parking a permanent part of their business.

"As our business grows and gets more competitive, it's good to offer things that will bring people to our site," said Allen Massey, owner of StorageMax, who estimates that 35 percent of his parking-space customers also rent storage units.

Massey plans to spend about $250,000 to cover 30 parking spaces on one-third of an acre at his Rolesville facility, which includes 500 mini-storage units. The parking spaces will cost as much as $200 a month. The way Massey sees it, people spend big bucks on their boats and RVs, so they would happily pay big bucks to protect them.

That strategy worked for Brassfield Self-Storage in South Durham. At its Page Road facility near pricey homes surrounding Brier Creek Country Club, 30 covered parking spaces rent for as much as $125 a month -- about twice what they fetched two years ago, when the spaces weren't covered, manager Randy Petrosky said.

"Once we did that, we had people standing in line," he said.

Brassfield built 40 covered spaces at a 270-unit storage center on Alston Avenue. Three months after opening, two-thirds of the spaces are occupied.

Some companies are skipping the mini-warehouses and focusing only on parking.

The Extra Garage is being built off U.S. 64 near the Wake and Chatham county border. It targets customers east of Jordan Lake who need to store boats, RVs, motorcycles, classic cars or "whatever you can't fit in your garage," developer Walt Lewis said.

Lewis got the idea from the place where Dane Allen encountered the police: Cary.

"They don't want you to store your stuff in Cary," said Lewis, a Cary resident. "If you do, then they want it to be in an ultra-expensive brick, enclosed, office-class building."

Residents either pay big bucks or cede big portions of their yards. "It's a perfect storm," Lewis said. "The homeowners [associations] say, 'You can have all the toys you want, but you can't park them here.' "